News

Posted on May 19th, 2011 in Industry News

NAMFISA

The majority of industries in which actuaries in Namibia operate are regulated by the Namibian Financial Institutions Supervisory Authority (NAMFISA). The activities of actuaries are regulated by the Acts governing each of these regulated industries.

In addition to the Namibian Acts, actuaries are governed by the guidance notes issues by various professional bodies. In Namibia, most actuaries are members of either the Actuarial Society of South Africa or the Actuarial Profession in the United Kingdom. The guidance notes regulate issues ranging from the manner in which certain calculations are to be performed to the manner in which actuaries should communicate with their clients.

The Society of Actuaries of Namibia was also recently established. The purpose of this organisation is to promote the actuarial profession in Namibia. The actuaries in Namibia are likely to continue operating under the guidance of foreign actuarial organisations for the near future, but the newly established society will contribute significantly to the development of the profession in the long term.

Noteworthy recent developments in the industry

The most noteworthy development in the past year has been the establishment of the Society of Actuaries of Namibia. For the first time Namibian actuaries now have national representation, marking the growth of the profession in the region.

The other noteworthy development is the establishment of an examination system by the Actuarial Society of South Africa over the past few years. South African law and the manner in which insurers, medical aids and pension funds operate in South Africa is closely aligned to that of Namibia. Actuaries operating in Namibia can now choose to write their examinations through the Actuarial Society of South Africa and such exams will be more applicable and relevant to them than the British exams they would have written in the past.

Both of these developments are likely to have a significant influence on the growth of the Namibian actuarial profession in the future.

Legal developments affecting actuaries in Namibia

The Government in Namibia is currently in the process of replacing a number of Acts with the Financial Institution and Markets Bill. This new Bill will change the regulatory environment for, amongst others, the insurance, retirement and healthcare institutions that utilise the services of actuaries in Namibia. For example, the proposed changes to the medical scheme regulations will greatly impact the manner in which the contributions to medical aid funds are calculated by the actuaries of these funds.

These potential changes will directly affect the above institutions and will thus further impact the actuaries operating in Namibia.

Namibia’s actuarial talent

Namibia has historically struggled to retain much of its actuarial talent due to the similarity, the proximity and the ease of transfer to the significantly larger South African market. Many Namibian actuarial students elect to study in South Africa (and other countries, although to a smaller degree) and subsequently seek employment there. Namibian students also often relocate to South Africa in order to further their careers in a more challenging environment. This problem is not unique to Namibia and many other African countries struggle to retain their actuaries for the same reasons.

The demand for actuarial services in Namibia greatly exceeds the supply. This has resulted in a large proportion of the required actuarial services being “imported” from South Africa. This also however benefits Namibia as the institutions making use of the services of such actuaries gain expertise that has been developed in other markets as well.

The establishment of the Society of Actuaries of Namibia will promote the actuarial profession in Namibia which, in turn, may lead to an increase in the demand for actuaries. It is hoped that these events will contribute to an increase in the number of actuaries and actuarial students electing to practice in Namibia.

Client industries

The industries/entities that generally use actuaries in Namibia are:

• Life Insurance
• General Insurance
• Retirement Funds and Investment Managers
• Medical Aid Funds

The life insurance industry typically employs actuaries and consultant actuaries, whilst the other industries almost exclusively use consultant actuaries in Namibia.

All of these industries are well developed and generally financially sound in Namibia. The life insurance, general insurance and investment management industries are, however, dominated by South African owned entities with minority Namibian stakes. The medical aid industry is an exception with the market being dominated by local Namibian brands.

The future for actuaries in Namibia

The Society of Actuaries of Namibia will increase its presence in the actuarial market which, in turn, will hopefully lead to an increased profile of the actuarial profession in Namibia.

The potential legislative changes will also result in additional challenges for actuaries in Namibia.